GRAND RAPIDS, Mich., Jan. 19, 2026 (GLOBE NEWSWIRE) -- Meritage Hospitality Group Inc. (OTCQX: MHGU), one of the nation's premier franchise operators, today reported preliminary financial results for the fourth quarter and fiscal year ended December 28, 2025, ahead of presenting at the Sidoti Micro-Cap Conference.
2025 Full-Year Highlights:
- Sales were $617.7 million compared to $668.8 million last year.
- Earnings (Loss) from Operations were $(22.9) million compared to $13.3 million last year (current year included one-time and non-cash charges of $13.7 associated with pre-opening & costs related to the closure of 21 underperforming restaurants).
- Net Earnings (Loss) was $(26.3) million compared to $8.0 million last year.
- Consolidated EBITDA (Loss), a non-GAAP measure, was $(6.8) million compared to $42.4 million last year.
- Restaurants in Operation 365 compared to 379.
2025 Fourth Quarter Highlights:
- Sales were $145.0 million compared to sales of $168.7 million for the same period last year.
- Loss from Operations were $(15.7) million compared to $(2.3) million for the same period last year (current year included one-time and non-cash charges of $10.6 million associated with pre-opening & costs related to the closure of 21 underperforming restaurants).
- Net Earnings (Loss) was $(13.4) million compared to $5.2 million for the same period last year.
- Consolidated EBITDA (Loss), a non-GAAP measure, was $(12.3) million compared to $13.7 million for the same period last year.
In 2025 the Company experienced margin compression driven by record high prime cost (food, paper and labor) led by beef inflation and elevated discounting. Looking ahead, in 2026 we see substantial EBITDA recovery as significant cost saving initiatives materializing, and new product innovations come to market. Additionally, we see the potential for reduced product costs with lower beef tariffs and the potential opening of the US border to Mexico for cattle imports which could materially alter the beef cost outlook. "I cannot say enough about the work our restaurant leaders have done to combat outside cost pressures and improve productivity. We had a once-in-a-quarter century margin compression last year, driven by unusual protein inflation and operational disruptions that created a timing mismatch between sales, costs and pricing actions. Looking ahead, we believe Wendy's will deliver wins in 2026 with more innovation around chicken and marketing" stated Meritage CEO, Robert E. Schermer, Jr.
The Company expects to gain leverage from general and administrative cost reductions as well as operational efficiencies including pattern of management, technology and delivery options designed to improve four wall economics and customer experience. The company ended the year with 365 restaurants across 15 states including the Company's Morning Belle restaurants, its breakfast/brunch/lunch concept that delivered +8.7% of same restaurant sales in 2025.
Initial Fiscal 2026 Outlook: A Margin Recovery Story:
- Sales of $610 million to $620 million
- Earnings from Operations $6.0 to $7.0 million
- EBITDA $18.0 to $20.0 million
- Restaurants in Operation 355
The Company's strategic priorities are focused on leveraging cost savings and returning to normalized margins in our restaurant operating platform.
About the Company:
Meritage Hospitality Group is one of the nation's premier restaurant operators, currently with 365 restaurants in operation located in Arkansas, Connecticut, Florida, Georgia, Indiana, Massachusetts, Michigan, Missouri, Mississippi, North Carolina, Ohio, Oklahoma, Tennessee, Texas and Virginia. Meritage is headquartered in Grand Rapids, Michigan, operating with a workforce of over 10,000 employees. At fiscal year-end 2025, the Company had total weighted average fully diluted common shares outstanding of 6,681,000.
The Company's current and publicly available information pursuant to amended SEC Rule 15c2-11 and FINRA Rule 6432 can be found at www.otcmarkets.com, under the stock symbol MHGU/Disclosures or the Company's website, www.meritagehospitality.com-
SAFE HARBOR STATEMENT
Certain information in this new release, particularly information regarding future economic performance and finances, and plans, expectations and objectives of management, constitutes forward-looking statements. Factors set forth in our Safe Harbor Statement, in addition to other possible factors not listed, could affect the Company's actual results and cause such results to differ materially from those expressed in forward-looking statements. Please review the Company's Safe Harbor Statement at http://www.meritagehospitality.com-
CONTACT:
Robert E. Schermer, Jr., CEO
Meritage Hospitality Group Inc.
(616) 776-2600
